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What are the Main Causes of Poverty?

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Poverty refers to the situation of not having enough money to meet the needs of food, clothing, and housing. Every fourth person in India is poor, which means about 260 million people in India live in poverty. This means that it is the biggest focus of the poor in the world and shows the gravity of the challenge.

Poverty should be viewed as the poor living solely in a poor environment with isolated poor people, excluded from enjoying the social equality of the better-off in better surroundings. Social exclusion can be both a cause and a consequence of poverty in the traditional sense.

Deficiency against poverty is a measure that describes the better likelihood of certain communities (members of backward wealth) or individuals (similar to a widow or physically challenged person) being poor or living in future generations. 

Poverty Line

The poverty line is based on the level of earnings or consumption. A person is considered poor if his or her earning or consumption status falls below the mandated “minimum status” to meet their initial needs.  It represents the ability to satisfy the minimum condition of human needs. The line divides people into 2 groups:

  1. Above the poverty line
  2. Below the poverty line


Causes of Poverty

There are many reasons for the increasing poverty in India. The low rate of growth continued from British imperialism till the nineteen-eighties. This resulted in fewer job opportunities and a lower rate of influx of resumes. It was accompanied by a high growth rate of population. Both are associated with greatly reducing the rate of growth of per capita income. Failure on both the profitable growth and population regulatory fronts perpetuated the cycle of poverty.

With the  Green Revolution,  employment opportunities were created in the agriculture sector; however, the goods were limited in some areas of ​​India. Industriousness assigned some positions, both in the public and private sectors, but these were not enough to absorb all the job applicants. Unable to find respectable jobs in the metropolis, many people were working as taxi clerks, traders, construction workers, domestic maintainers, etc. They began to live in slums on the outskirts of the metropolis and the problem of poverty, originally a pastoral phenomenon, also increased in the metropolitan area.

Another feature of high poverty grades has been the huge income inequalities. An important accounting for this is the unstable distribution of land and other treasures. Despite many programs, we have not been able to dive into the effect expressively and major policy initiatives such as land reforms; aimed at redistributing resources in pasture areas have not been duly and effectively implemented by the State Governments. 

Several disparate socio-cultural and economic factors are also responsible for poverty. People in India, including the poor, spend a lot of income to fulfill social scores and observe religious rituals. Small growers require money to purchase agricultural inputs such as seeds, poisons, etc. Since poor people hardly have any savings, they loan them from money lenders. Unable to repay, due to poverty, they become casualties of liability. Therefore, high debt status is both a cause and a consequence of poverty.

Major Causes of Poverty

  • Rural & metropolitan Economy: Rural and metropolitan poverty differ in many situations. The differences between rural and metropolitan cultures have different baggage on their poverty script. For illustration, the survival of the poor is more sustainable in rural areas than in metropolitan areas because of the higher cost of living.
  • Heavy pressure of population: The population of India has increased continuously over the ages. During the last 45 eras, it has grown at a rate of 2.2 per year, which means, about 1.7 million people are added to the country’s population each year. This leads to a massive increase in the demand for consumption goods.
  • Lack of Education: Not everyone lives in absolute poverty without schooling. But consummate adults living in absolute poverty did not receive caliber education. And, if they have kids, they’re probably contributing to them. There are many walls around the world for education, lack of money for uniforms and books, or cultural tendencies against girls’ education.
  • Lack of proper industrialization: One of the major reasons for poverty is low productivity in the animal husbandry sector. The reason for low productivity is manifold. Mainly, this is due to fragmented and sub-divided land goods, lack of capital, ignorance about new approaches in animal husbandry, use of prescriptive fashions of animal husbandry, destruction during storage, etc.
  • Social factors: Asunder from profitable and marketable, there are correspondingly social delegates hindering poverty release in India. Some constraints in this regard are the laws of heritage, caste system, some traditions, etc.
  • Mass migration to cities: It’s significant to circumscribe over-crowding of the metropolises. This can be achieved by preventing mass migration, especially in metropolitan cities. The consummate rural people left their village and consequently shifted to the metros in search of employment opportunities. They will, however, move around contentedly and stay in their villages if the administration can satisfactorily expand the rural areas and deliver the analytical application effortlessly as enlightening openings to the rural population. This will reduce the urban poverty indicator and also keep the metropolitan population in a regulated manner.
  • Multitude divorce rates and Feminization of Poverty: Feminine gender of the society should be given equivalently employment openings to abolish feminization of poverty. Correspondingly, multitude divorce rates causes poverty among the feminine section that can not endorse themselves due to gender inequality.

Dimension of poverty 

  • Hunger
  • Lack of shelter and clothing
  • Poverty is being unwell and not able to endure a doctor.
  • Not able to send the child to school.
  • Lack of regular job
  • Illiteracy
  • Poor sanitation and lack of clean water.
  • Helplessness

Major Programs Initiated by Government

After India gained its independence,  action to reduce poverty in India was understood, as in estimating the poverty rate in India by Minhas in 1950, setting a poverty line for India in 1960, and many others. In the most critical post-independence period, the presidency of India’s third prime minister, Indira Gandhi, considered poverty as a “public consequence”. To achieve two main goals, remove poverty ‘Garibi Hatao‘ and achievement of self-reliance. D.D. Dhar fitted and initiated the 5th Five Year Plan through better measurement of income, higher growth rate advancement, and suggestive flourishing in the rural sector. 

A few important government initiatives are:

  • Integrated Rural Development Program
  • Jawahar Rozgar Yojana
  • Jawahar Gram Samridhi Yojana
  • Employment Assurance Scheme
  • Food for Work Program
  • Sampoorna Grameen Rozgar Yojana
  • Pradhan Mantri Gramin Awaas Yojana
  • National Social Assistance Program (NSAP)

Sample Questions

Question 1: Why are employment generation programs important in poverty alleviation in India?


  • The direct relation between employment and poverty alleviation: There is a close relationship between employment and poverty. If employment opportunities are created, more people will get employment, which will increase their income, thereby reducing poverty.
  • Higher Standard of Living: With the increase in employment opportunities, income will increase and poor people will be able to enjoy a higher standard of living and greater access to education, health facilities, proper sanitation, etc.

Question 2: Discuss the major reasons for poverty in India.


  •  Illiteracy: The rate of illiteracy was very high in independent India just after independence. The reason for this was that the British did not spend equally on education and discouraged educational reforms. Over the years, the literacy rate has increased, but still, around 30 percent of Indians are illiterate, so they find it difficult to engage in well-played economic activities and thus remain poor.
  • Unemployment: It is the second major cause of poverty. Those who do not get work, sit idle. Unemployment is basically due to the unavailability of education which plays an important role in the social and economic development of the individual. 
  • Inequalities of Incomes: Unequal distribution of income is another cause of poverty. Money is given in the hands of some people and then they distribute it. One of the main reasons for this is the uneven distribution of land and other resources. Despite several policies, we have not been able to tackle this issue in a meaningful way. Land reforms aimed at redistributing wealth in rural areas have not been implemented properly.
  • Slow Growth of Employment Opportunities: There has been a slow growth of employment opportunities, especially in the industrial sectors. On the other hand, the population is increasing day by day leading to the growth of labor without adequate employment opportunities. Failure on both fronts: the promotion of economic growth and population control have perpetuated the cycle of poverty.

Question 3: Identify the social and economic groups which are most vulnerable to poverty in India.


 Groups vulnerable to poverty can be divided into two groups:

  • Social groups vulnerable to poverty
  • Economic groups vulnerable to poverty
  • 29% of scheduled castes are poor and 43% of scheduled tribes are not able to meet their basic needs and come under social groups vulnerable to poverty.
  • The rural agricultural labor households and the urban casual labor households are the most vulnerable groups among the economic groups vulnerable to poverty

Question 4: Give an account of the inter-state inequalities of poverty in India.


 In India, one of the aspects of poverty is inter-state inequalities. There are different amounts of poor people in every state. Although state-level poverty has shown a steady decline since the early seventies, success rates vary from state to state, some of the facts relating to inter-state inequalities of poverty.

  • Significant decline in poverty has been observed in Kerala, Andhra Pradesh, Gujarat, and West Bengal, Tamil Nadu.
  • In Orissa and Bihar, poverty is still a serious issue and these states have the highest poverty ratios in the country.
  • The percentage of urban poverty is also very high in states like Uttar Pradesh and Bihar.
  • The inequality is due to the changing social and political scenarios of different states.
  • Factors such as success in population control, availability of resources, and tourist destinations have also led to this disparity as all these factors are variable.

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Last Updated : 06 Dec, 2022
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